Technology May 03

Taiwan’s TSMC backs European Union push to build chip hub

US competitor Intel's chief executive demands $8 billion in subsidies before committing to semiconductor development programme

Taiwan’s TSMC backs European Union push to build chip hub
TSMC is the world's No.1 chip maker, ahead of Korea's Samsung and US-based Intel. The company said the talks with the EU's Breton demonstrated its commitment to the region. File photo by Reuters.

(ATF) Taiwan Semiconductor Manufacturing Co says it will back a European Union (EU) push to develop chipmaking on the continent, officials have revealed.

European Commissioner for the Internal Market Thierry Breton held talks on Friday with Maria Marced, president of TSMC Europe, in what he described as a "good exchange".

TSMC is the world's No.1 chipmaker, ahead of Korea's Samsung and US-based Intel. The company said the talks with Breton demonstrated its commitment to the region.

 "Our desire to support our customers as fully as possible means that we’re always willing to establish open communications with governments and regulators wherever they, and we, are based," TSMC said in a statement.

However, US giant Intel said it wants 8 billion euros ($9.7 billion) in public subsidies towards building a semiconductor factory in Europe as the region seeks to reduce its reliance on imports amid a shortage of supplies.

Companies around the world, especially carmakers, have had to adjust production due to the chip shortages, caused by manufacturing delays that some semiconductor makers blame on a faster-than expected recovery from the coronavirus pandemic.

STATE AID

This is the first time Pat Gelsinger, Intel's chief executive, has publicly put a figure on how much state aid he would want, as Intel pursues a multi-billion-dollar drive to take on Asian rivals in contract manufacturing.

"What we're asking from both the US and the European governments is to make it competitive for us to do it here compared to in Asia," Gelsinger told Politico Europe in an interview.

The meeting with Gelsinger was an "in-depth discussion”, Breton said. "To meet current and future semiconductor industry demand, Europe will drastically increase production capacity - both on its own and through selected partnerships to ensure security of supply," he added.

On Tuesday, Breton meets the heads of two important Dutch semiconductor players: ASML, the leading maker of semiconductor lithography tools, and chipmaker NXP.

Germany's Infineon, another major chipmaker, said on Friday it welcomed Breton's initiative to strengthen chip production in Europe.

The EU aims to cut its dependency on Chinese and other foreign suppliers in six strategic areas - including raw materials and pharmaceutical ingredients as well as semiconductors - under an industrial action plan to be announced on Wednesday.

With reporting by Reuters

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TSMC Taiwan EU semiconductor chip Pat Gelsinger Thierry Breton